How does Klavena automate ecommerce accounting?

Klavena transforms payout data from Amazon, Shopify, Walmart, PayPal, Macys, Kohls, Bed Bath & Beyond into organized summaries that reconcile perfectly in QuickBooks Online.

It automatically classifies sales, fees, taxes, refunds, and other items, organizing transactions into summaries that match perfectly with the payout deposits in your accounting software. This streamlined process enables you to reconcile payouts with just a single click.

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With Klavena, you’ll:

• Automate a time-consuming monthly process
• Always pay the right amount in taxes
• Get a better view into your financials with a more detailed Profit & Loss Statement (P&L)
• Have confidence in the accuracy of your books

Why is ecommerce accounting challenging without Klavena?

Ecommerce payouts differ from payments in traditional retail sales.

In traditional retail, sellers typically receive money directly from buyers, establishing a clear link between the source of funds and the purpose.

However, this direct connection is absent in ecommerce transactions. Ecommerce businesses receive payments in batches from their sales channels, leading to various accounting complexities.

Correctly accounting for ecommerce transactions is difficult because:

1. All transactions are lumped together into batched payouts.
2. There’s no clear timeline or cutoff for payments. One payout could cover multiple days, weeks, months, or even partial periods, meaning a day could be split into separate payouts.
3. The payout doesn’t just cover sales and could also include; tax collected, shipping income, discounts, refunds, fees, disputes, pending payouts, and many other transaction types.
4. One payout might cover multiple countries, meaning different tax rates need to be applied.
5. Transaction types aren’t always labeled correctly, which makes them difficult to identify if they change or a new one is added.

For correct accrual accounting, financial reporting, and tax compliance, these batch payouts from sales channels like Amazon, Shopify, and other gateways need to be broken down into the correct transaction types, time periods, tax rules, and locations.

It might seem obvious to get this information from your sales channel, but it’s not so straightforward. Reports that are generated from sales channels contain a lot of raw data that isn’t categorized. Think of a spreadsheet with thousands and thousands of rows.

So, the ecommerce merchant has to try and split out the data manually in a spreadsheet.

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At worst, this is near impossible. At best, it’s incredibly time-consuming and error-prone.

Even if the ecommerce merchant manages to get the numbers close, they would then need to create manual entries in their accounting system every time they receive a payout. And they would still have a residual balance that isn’t accounted for.

When it comes to paying tax, making financial decisions, calculating margins, or even valuing your business, close enough isn’t good enough.

Why do the top ecommerce businesses, bookkeepers, and accountants trust Klavena?

• Klavena is the most accurate solution. Klavena doesn’t just transfer data from your sales channels to your accounting software, it first makes sense of the data. Your transactions are grouped into the correct categories and time periods, with tax rules applied, and batched into summaries that match to the payouts in your bank feed for reconciliation.
• Klavena is reliable. With experience in reconciling millions of ecommerce transactions across different countries, currencies, and tax jurisdictions, Klavena leads the way in ecommerce accounting.
• Klavena will get your books up to date in no time. Unlike trying to organize raw data manually, with Klavena, there’s no room for error, no time wasted, and no manual entries. Klavena can also fetch historical data if you’re behind in your bookkeeping.
• Klavena is customizable. You have the power to customize Klavena for your specific accounting needs. From account codes, tax rules, transaction categories, and more. Klavena gives you as much or as little control as you need.
• Klavena has a support team that understands ecommerce accounting. Many of our support representatives have a background in accounting or bookkeeping. They’re located all around the world, meaning you can get local assistance in hours, not days.

Is Klavena safe?

Yes, Klavena ensures top-tier security by storing all data within the Amazon Web Services (AWS) infrastructure, utilizing servers located in the USA. AWS, a prominent server infrastructure provider, adheres to rigorous US and EU data protection standards. Data stored on AWS is encrypted using the Advanced Encryption Standard (AES) algorithm, AES-256, guaranteeing robust security during storage and transfer.

Within AWS, strict Identity and Access Management (IAM) controls are implemented, with application privileges and credentials closely monitored to prevent unauthorized access. Klavena's Data Protection Officer oversees security processes, emphasizing data protection as a paramount concern throughout the system.

For more information, you can read the Klavena Privacy Policy. 

Overall, these measures demonstrate that Klavena takes data security seriously and is committed to providing a safe and secure platform for its users.